Horchow.com Makes Strong Start

Less than six months since its launch, Horchow.com accounts for 20 percent of the Neiman Marcus Group-owned brand's sales across the online and catalog channels.

The vast majority of the online sales are from customers new to Horchow who were attracted online. The site offers a mix of home furnishings across categories from the top-performing Horchow catalogs.

"We launched Horchow.com in July and were in full swing by late fall," said Michael Crotty, vice president of marketing at Neiman Marcus Online, Irving, TX. "Business was very strong and way ahead of what we planned."

Online marketing was a major help in growing the pie for Horchow. The site is advertised on MSN, House & Garden's HGTV.com and a few small home decorating sites. Keyword buys on Google and via Overture pitched in.

"All of these programs have been very successful this fall," Crotty said. "We're now starting an affiliate program as well. E-mail is also an important source of sales.

"We also don't have a ton of promotions. No free shipping, because of the merchandise mix, and yet consumers are still shopping. I think when you offer unique merchandise from a strong brand that hard promotions are not that necessary."

Horchow.com comes from the same Neiman Marcus stable as NeimanMarcus.com and chefscatalog.com, both online stores to their catalog or store siblings. The site reports to Neiman Marcus Direct's online arm.

The site is organized around eight merchandise categories. They are furniture and rugs, bedding and bath, tabletop and kitchen, decorative, desktop and stationery, antiques and collectibles, garden, and epicure and seasonal.

Catalog merchandising is markedly different. Horchow drops category-specific books yearly. Each is positioned as Horchow Garden, Horchow Fine Linens or Horchow Bed & Bath. No single book covers the entire breadth of offerings. Horchow now adds copy in its catalogs like, "Shop Horchow.com to find more of what you love."

The online store uses most of the photography and main creative from all of the catalogs. The objective is a consistent look and feel and brand experience between the catalog and online channels.

"The site allows us to provide more information and pictures of the furniture we sell than does the catalog," Crotty said. "Maybe this explains why we're selling more furniture than we would have expected. In general, the style of furniture we sell on Horchow is not widely distributed. It is rather unique and not something you find at the local mall."

Of course, Horchow also rode the wave of a renewed consumer trend of staying and entertaining at home.

It is too early to tell whether the Horchow online shopper differs from the catalog shopper.

"I suspect it's not that different," Crotty said. "The prices of our products are not cheap. We're not a value proposition. But our customer expects us to deliver on our quality and uniqueness promise."

A best-selling product online is its Huntington Vanity sink stand for bathrooms. Intricately carved, the hardwood vanity has a mahogany finish, fossil-stone veneer top and punch-out back. The faucet is made of charcoal-finished brass and flows into an under-mounted sink. Cost? $1,849.

Typical Horchow customers are in their mid-40s, heavily skewed toward women. Their household income is more than $100,000 a year, and they are highly educated. More importantly, they are focused on their home, not utilitarian items but those that make a statement.

Horchow sends its 22 buyers around the world looking for unique items, keeping in mind their appeal to this consumer profile.

In the spring, Horchow will add items to the site that are absent from the catalogs for the season. The logic is to expand the assortment online with less risk than listing it in the catalog.

Despite the success of the online store, there are no plans to cut back on catalog circulation or frequency. Horchow will mail about 27 different catalogs this year, as it did last year. Total circulation is estimated at 40 million copies.

Horchow dropped its first catalog in 1971. Neiman Marcus acquired the then-Horchow Collection in 1988.

The Web has yet to cannibalize catalog sales for Horchow. If things go as planned, Horchow.com will be strong, complementary support for the catalog business.

For example, one of Horchow's key differentiators from its competition is its assortment of personalized merchandise. Monogrammed linens and stationery are highly popular. In many cases, monogramming is a free service to customers.

"We went to great lengths to ensure the site supports this crucial part of our business," Crotty said. "This was a challenge that we didn't have when we launched NeimanMarcus.com or chefscatalog.com. We've now added it to Neiman's, but it was never a big part of the Neiman Marcus business and that wasn't the case for Horchow."

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